Abstract It is a foundational principle of international arbitration that arbitral tribunals are bound by the choice of law effected by the parties. A tribunal’s failure to apply the designated national law exposes its award to the gravest of consequences—annulment at the seat or refusal of recognition and enforcement under the New York Convention. This proposition, though uncontroversial, leaves unexamined a more intricate and far less settled question: to what extent are arbitral tribunals correspondingly bound by the judicial interpretation of that national law rendered by domestic courts? While arbitral practice has long assumed that fidelity to the parties’ chosen law is essential, the jurisprudential status of domestic courts’ interpretations within that framework remains elusive. Only in recent years has scholarly inquiry begun to interrogate whether, and to what extent, arbitral tribunals may legitimately depart from judicial constructions of national law, thereby asserting a measure of interpretive autonomy. The contours of this inquiry raise questions of profound consequence: what does it mean for tribunals to apply a national law in a transnational forum? Does arbitral fidelity extend to the methodologies and interpretive traditions of the forum courts, or may tribunals engage in an independent construction of the text, unmoored from domestic judicial precedent? These questions lie at the heart of this article.
Bermann et al. (Fri,) studied this question.